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Week of December 6th, 2021

Here is what is happening in commodities this week:

Lumber……A strong sales pace has continued at the mills again this week. Mill order files are early to Mid-Jan on many items and prices are up 50/m to 75/m depending on the item.

Logistic issues and production cut backs that took place a number of weeks ago are having a big impact. Many home builders have long order files and some are booked out through 2022 already!

These three things combined have created a rapidly rising market.

This is eerily similar to the market earlier this year, where price did not really matter as buyers scrambled to meet their needs, they just needed coverage.

Where do we go from here? Some mill reps think that we could run as high as 12-1300/m on 2×4 2&BTR Randoms, currently sitting around 1050/m.

Time will tell but this market certainly feels firm till the end of January.

Plywood…. Mills are OTM this week and print was up 8% at Mid-Week. Order files are Late Jan early Feb. Mills report that all regions are short on plywood and they expect the prices to continue to climb.

They are trying to do a better job of controlling order files by not letting files get to long. Mills have seen offers from buyers at prices well over what they are asking today but have resisted  those offers. That way if there are disruptions in log supply or shipping issues like we are experiencing right now the ups and downs of those events can be better managed. And we all remember the collapse of the last run and no one including the mills want to deal with a situation like that again.

Watch for prices to be up when mills come back on the market next week.

OSB….. Mill files are into January and the field is light on OSB. Many regions are being starved of product due to shipping issue’s and are willing to pay premiums in order to secure some product.

Problem is that it really doesn’t matter what you pay for stock if the mill can’t get it to you, so the question is: If we could snap our fingers and have trucks and rail cars running full tilt tomorrow

would the markets be able to sustain current price trends? Just like what happened with toilet paper at the start of the pandemic, even though you had plenty you likely bought extra just in case the world ran out and that added to the panic.

Watch for prices to continue to rise next week on OSB as well.

Have a great week and please contact us with any of your inquires.